When Will i3 Verticals, Inc. (NASDAQ:IIIV) Turn A Profit?

With the business potentially at an important milestone, we thought we'd take a closer look at i3 Verticals, Inc.'s (NASDAQ:IIIV) future prospects. i3 Verticals, Inc. provides integrated payment and software solutions to small- and medium-sized businesses and organizations in education, non-profit, public sector, and healthcare markets in the United States. The company’s loss has recently broadened since it announced a US$4.5m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$14m, moving it further away from breakeven. The most pressing concern for investors is i3 Verticals' path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for i3 Verticals

According to the 7 industry analysts covering i3 Verticals, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$9.0m in 2023. The company is therefore projected to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 112% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth

Given this is a high-level overview, we won’t go into details of i3 Verticals' upcoming projects, but, keep in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. i3 Verticals currently has a debt-to-equity ratio of 106%. Typically, debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of i3 Verticals which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at i3 Verticals, take a look at i3 Verticals' company page on Simply Wall St. We've also compiled a list of important aspects you should look at:

1. Valuation: What is i3 Verticals worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether i3 Verticals is currently mispriced by the market.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on i3 Verticals’s board and the CEO’s background.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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